Buy 1 get 1 free (BOGO) ecommerce – Factoryrush

One day delivery, heavy discounts and inventory less- marketplace model, have been the key success paths of the existing ecommerce portals. However, Gurgaon based ecommerce venture, Factoryrush.com, plans to take this success model a step ahead, thereby joining the traditional ecommerce ways with a simple yet effective promotion concept- BOGO – Buy One Get One Free.

Launched in December 2013, Factoryrush is a venture of 4 viz. Mayur Karwa, Ankush Karwa, Anant Bisht and Neeraj Choudhary. The startup aims at delivering factory goods directly to the consumers’ doorsteps cutting down the supply chain and thus the costs to its minimum. At the same time, allowing factories to earn more revenue by way of forward integration – making it a win win situation for all.

However, a major challenge faced was the bulk made by the factories and on the contrary, very small quantity purchased by the consumer. This gives way to their base model- BOGO. “Although, the technique is quite old but till date, no ecommerce retailer in India has made its primary selling proposition”, said Mayur. Also, the company differentiates from its existing competitors with its ability to source products directly from factories and make them available at very reasonable prices.

Currently focusing only on the fashion category, the portal offers limited product categories, restricted to kurtis & leggings for only women and footwear for both. The online buyer is allowed to add two products of his/her choice to the cart. The one which is priced lower will automatically become free. If both the products are of same value, they will charge only for one pair and the other pair is free.

The company, at present finds association with around 20-22 factories in cities such as Jaipur (kurtis), Mumbai, China (footwear), Agra and Kanpur. In near future, the team aims to add more factories to the list and also to enter men and women apparel segments.

Since its launch, the portal has generated an average traffic of 5 lakhs per month and it is observed to increase at a compounded monthly rate of 10%. Factoryrush is currently using Facebook, retargeting and Email marketing as the promotion tools. However, founders have a firm belief that an offer like Buy one Get one free has social virality attributes associated with it.

Blue Dart, FedEx and Delhivery are the logistics partners of the company with nearly all major payment options available viz. Net banking/credit card/debit card/ COD. There is no minimum free shipping concept. Every transaction is levied with an additional INR 49 as the delivery charges. The shipping time for an order is approximately 2-3 days and follows refundable policy of 15 days.

On asking how this policy will sustain in the current world of almost free and one day delivery, Mayur answered, “We always believed in transparent pricing and that is why we didn’t mark up our product pricing to take care of logistics expenses.”

The startup is currently self-funded, but is looking forward to raise outside funding in order to scale up its operations. Also, the founders are planning to reach break-even by middle of this year.

In the past few years, it has been observed that discount is not a sustained ecommerce business model and has led to shut down or acquisition of many. With Factoryrush dealing majorly with non-branding stuff, how many takers would one go for unbranded and discounted products, even when companies like Koutons failed to survive long enough with BOGO kind of deals.

Infact on doing a little more research I found that not just Everlane, there are many more with a similar concept – Everlane, Warby Parker, Bonobos etc.

Everlane specializes in apparel, Warby Parker concentrates on eyewear, and Bonobos focuses on pants. Though they are dealing in same categories, all of them have the same strategy : bypass expensive licensing fees and do everything themselves: design, manufacturing, branding and retail. Essentially, they’ve cut out the middlemen and retail store costs that play into the logical cause of huge markup.

Rohan Bahl

The concept seems to very similar to everlane model.

http://www.jasskaran.iglobul.com Arvinder Singh

hi meha i have read your article and would like to bring to light the background of these 4 people you mentioned in your article i.e. Mayur Karwa, Ankush Karwa, Anant Bisht and Neeraj Choudhary. These 4 have earlier also floated no of e-commerce ventures (www.iglobul.com, http://www.goo2o.com, beatbox etc etc) and duped innocent people of lakhs of rupees (Pls do read: http://www.consumercourt.in/online-shopping/26325-iglobul-online.html, http://www.grahakseva.com/complaints/11505/not-paying-amount-as-per-agreement-by-goo2o). “The startup is currently self-funded” – this is totally bullshit stuff. From their earlier ventures they have collected huge sums of money from small investors like me (Rs. 2 lacs) against a guaranteed monthly payout (Rs. 5000 pm) and then failed on their commitments. During the initial months they used to pay regularly to avoid suspicion but after few months their cheques started bouncing and when confronted they used to give unacceptable excuses. I have made numerous calls and personal trips to their office at 464, Udyog Vihar, Phase-5, Gurgaon just to collect my payments and verbal fights etc. The police was also called in no of times for a settlement. I have been tortured so much by these 4 people that I even thought of committing suicide as I felt so much guilt for not consulting my family and going for a investment with these thugs. I come from service profile family and for me Rs. 2 lacs was a very huge investment. I started up with them after paying Rs. 12,500 for an e-store named http://www.jasskaran.iglobul.com/ which has been un-operational for months now w/o any notice from these 4 people. After 6months of running this e-store, their marketing guys tricked me into investing Rs. 2 lacs for opening up window shops which people would visit and place their orders online. I would request your website to stop promoting such people who are no better then Mohd Ghaznavi, the British. These 4 have no ethics, no cultural values and should be criticized in public so that other people can be alerted and their safety can be insured against such thugs.